Chain Reaction

Here is my prediction for how the global margin call unfolds. Bearing in mind that this is all very subjective. Gamble at your own risk...

First off, late this past week Suze Orman warned of an imminent crash. As a registered perma-bull, she clearly is not an alarmist and so for her to see great risk means that the risk must be asinine stupendous. However, in the tradition of the buy and hold investment advisor profession, Orman never recommends selling stocks. The advice she gives is what one would give a twenty year old. Dollar cost average in the future. For those who are closer to retirement her advice is useless with regards to protecting them from risk. Investment advisors only ever recommend buy and hold. They never attempt to time the market. 

If Orman is right, then all she did was add to the prevailing angst and confusion. The vast majority of people won't get out if the crash is imminent. 

Here's what to do: Nothing

Getting back to the point of this post, Millennials are now massively leveraged to imploding Tech bubbles, cryptos, and junk stocks. So their gamified portfolios are the locus of maximum risk. 

I believe one of the first bubbles to explode will be crypto currencies, given that they have an established history of exploding. These are the only markets that are open on the weekends and as I write Dogecoin has already dropped -50% and is staging a weak bounce. Third, I've noticed that Ethereum is currently 90% correlated to the Nasdaq. Of the major cryptos, Ethereum has been outperforming Bitcoin recently as it often does at an impending reversal. 

After crypto Ponzi schemes, the next weakest link is Chinese stocks. Biden's China policies are merely continuing Trump's four year aggression. I predict it will all backfire spectacularly. 

U.S. markets and the Nasdaq in particular are extremely exposed to Chinese Tech stocks which are trading like bricks. These will be the first stocks to test the March 2020 lows and they will drag down many U.S. Tech ETFs along with them.

The next most vulnerable trades are all of the various bubbles that formed in 2020: EVs, Biotechs, Work from Home, Cloud Internets. In other words Ark ETFs.

The Work From Home stocks have the clearest corrective wave pattern:

Biotechs are the next sector that will retest the March 2020 lows.

When all of last year's Tech bubbles final explode along with crypto, Chinese stocks, and Ark ETFs, then Millennials will get margined out en masse. Nasdaq volumes will skyrocket beyond anything we've seen before. Brokers will go offline for hours at a time.

Volatility will explode and vol targeting algos will dump S&P futures day and night. It took central banks three weeks to get markets under control last year, this year it will take at least as long, but the carnage will be an order of magnitude greater.  

It will be a massive clusterfuck, beyond anything previously imagined.

Hard to believe, I know. 

Rigged To Explode

This cycle will end the exact same way it started, with broke Millennials protesting Wall Street corruption. This time however, there will be no rich assholes laughing at them, because their last bailout is in the rear view mirror...

As the market approached the February high I said there were more red flags than a Chinese parade. Since the Nasdaq crashed and burned and was resurrected, the red flag parade has become far larger:

The market is now a giant casino. Everyone is now playing against everyone else. It's clear that today's gamblers enjoy looking around the Blackjack table at all the people they hope to plunder in a zero sum game. Today CNBC and Marketwatch were lauding a crypto called "Dogecoin". It was started as a joke on the crypto market, but then it garnered the attention of billionaires Mark Cuban and Elon Musk so now it has zoomed from four cents to forty cents over the past few weeks "minting overnight millionaires". What they forgot to mention is that these millionaires are benefiting at the expense of those coming in at the end of the pump and dump. The many are minting the wealth of the few. Sound familiar? It's the S&P 500 in crypto form. Somehow a forty cent pump and dump scheme is now front page news.

As I pointed out yesterday, the Nasdaq has now round tripped back to the February opex high. Both stimulus rallies lasted the same amount of time - six weeks. The Nasdaq has now filled all of the open gaps from its breakdown in February. Now all of the open gaps are below the market and the options manipulation "stimulus" is set to expire. 

 

Revisiting the red flags that were evident in February, we notice that risks have only grown exponentially in the meantime. 

First of all, the SPAC bubble (not shown) with respect to listings has doubled in magnitude over the past two months, even though many deals are now failing and many SPACs are trading below net asset value. 

Next, from a positioning standpoint, the Rydex ratio peaked in February and it's making an even higher peak this month:

Active Managers were extremely bullish in February, then they got extremely bearish and now they've round-tripped back to la la land. In addition to gamblers going ALL IN at the end of the cycle, this robo rally has been fueled by bears capitulating en masse:

The crypto market was at $1.4 trillion in market cap in February and now it's at over $2 trillion. So that Ponzi scheme grew much larger. As a measure of social mood we can see that Dogecoin fever peaked in February as well, however that % gain was TWICE as large as this recent rally:

Those are the similarities to February - all indicating that risks have grown in the meantime. Here are the major differences:

First off, most Tech stonks did not join this latest round trip to all time highs on the Nasdaq. Here we see the ultra popular Ark ETF is obeying the opex rollover signal:

Unlike the Nasdaq, the NYSE keeps making new highs, but it too is highly manipulated by the monthly options cycle. New lows keep expanding with every passing opex and are correlated to Nasdaq new lows:

Here we see options expiration relative to the S&P 500. As we see, new lows on the NYSE and Nasdaq are becoming more sensitive to declines in the S&P 500:

What this tells us is that a handful of mega cap stocks are holding up the market in this liquidity driven robo rally.

We've seen similar times when the mega cap Tech went into melt-up mode. September, October, and November:

In summary, this is the longest melt-up rally in the past five years when measured by the % gain from the last tag of the 100 day moving average. 

Which is what one would expect at a super cycle top.

That no one sees coming.

The Madoff Moment

Systemic risk is record high right now because gamblers have been assured it's low, so they were given free money to leverage up to infinity in a "risk free" market. Bueller?

"Leverage is the use of debt (borrowed capital) in order to undertake an investment or project. The result is to multiply the potential returns from a project. At the same time, leverage will also multiply the potential downside risk in case the investment does not pan out"

Way back in 2008 as the banking dominoes fell one by one, corrupt policy-makers jailed Bernie Madoff for his collapsing Ponzi scheme at the exact same time as they were bailing out Wall Street for imploding the global financial system. It was a reward for corruption that would spawn an ensuing decade+ of ever-increasing decadence that will cost today's true believers in criminality far more than they can afford...

We got news today that Madoff died after serving time in jail for a crime that is now commonplace in today's markets. By today's standards, Madoff was a pioneer in Ponzi markets. A man before his time.

Step back and realize that it's no one's job to predict when it's the end of the cycle. Economists are always wrong in real-time which is why they always back date recessions after the fact. They are always driving the car forward by looking in the rear view mirror of stale data. When they finally realize the economy is off a cliff, it's far too late. Wall Street is even worse. Money managers don't get paid to sit in cash. They are not paid to time the market, so they don't. Which means they will never reach a consensus to sell everything. Or anything for that matter. That's the "buy side". The sell side of course is far worse, since they get paid to sell stonks and bonds to their clients. So their research is riddled with conflict of interest. Therefore what do all of these "experts" do? They ALWAYS assume we are in an expansion and a bull market. Because most of the time they will be right, and if they happen to be wrong, they will all claim that it was a Black Swan event. Nassim Taleb's theory of Black Swan events  has been used to exonerate Wall Street from rampant malfeasance time and again. All of which means that home gamers are blissfully clueless. They  eagerly believe the eternally bullish forecasts they are fed, because don't want to believe anything else. 

What this means is that anyone who wants to REALLY know what is going on in the economy has to do their own research and form their own viewpoint, based upon logic, facts, and history.

The lies that have piled up since 2008 have become ever larger and more ludicrous. Each resulting crash has been more sudden and brutal than the last. The epicenter of today's big lie is very similar to the one perpetrated in late 2008. A fake recovery attended by a failed bailout. As the financial dominoes fell in late 2007 and early 2008, policy-makers remained optimistic that the financial crisis was under control. Even after Lehman declared bankruptcy (Sept. 15th 2008), policy-makers, banksters, and investors were optimistic that the risk was contained. The massive monetary and fiscal bailout had worked and therefore the dreaded end-of-cycle de-leveraging was avoided. Except the bailout hadn't worked, because there had been no real de-leveraging in the mortgage market, in the corporate debt market, and of course in the stock market. 

Sound familiar?

Fed Chief Jay Powell was on Sixty Minutes Sunday Night:

SCOTT PELLEY: "The chances of a systemic breakdown like in 2008 are what today?"

JEROME POWELL: "The chances that we would have a breakdown that looked anything like that where you had banks making terrible loans and investment decisions -- and having low levels of liquidity and weak capital positions, and thus needed a government bailout, the chances of that are very, very low. Very low."

There are many extreme risks being ignored right now. I posted them on my Twitter feed this week, here they are again. 

However, suffice to say that by assuring investors there are no risks and then by inoculating them from losses and providing infinite leverage, the Fed itself is by far the biggest risk. 

"We’ve had many more inquiries over the past year than we would normally about people wanting to utilize their assets to get transactions"

In a bull market, share pledging can make the bets more lucrative...But the risks are also doubling when the market turns volatile"

Fortunately, central banks have dampened volatility and given everyone a false sense of low risk.

On the topic of fraudulent recovery, yesterday we got consumer inflation data and based upon the headlines one would assume the U.S. is becoming Zimbabwe. This latest "surge" in inflation leaves the CPI 4% lower than it was in 2008 right before the Lehman crash. 

Somehow serial inflation fearmongers have never once been right, but they still assume they know what they're doing. As always, arrogance and ignorance are a bad combination. 

What we notice is that even though the CPI is 4% lower than it was in 2008, the concern over inflation via Google Trends (lower pane) is higher today. This is what happens when you impoverish the middle class, even small price increases seem like a big deal. Wages and prices can go lower but they can never go higher. 

Today I had a major epiphany that the Nasdaq and momentum stocks are now 100% driven by the monthly options expiration cycle. Which explains why these tops keep occurring four weeks apart.

The massive call option buying by the Reddit gang is literally pushing the market higher into opex week. And then the "gamma" lift runs out of gas and then reverses creating a gamma crash. Gamma is the variable hedging factor that market makers use to hedge their call option (delta) exposure arising from selling call options. As these options head towards expiration, the amount of stock that market makers must hold to offset their short call position declines with option decay, so they sell. Essentially option gamblers are renting capital to manipulate the market. All of this Reddit-driven market manipulation is of course widely accepted and widely ignored. 

 

What happens at 'c' is TBD. 

This week combined crypto market cap surpassed $2 trillion up from $1 trillion at the start of the year. Up 1,000% year over year.

There are thousands of cryptos now and they are all predicated upon the greater fool theory. 

Looking back on this era, historians will say that ironically the week Bernie Madoff died, is the week that Ponzi schemes became widely accepted.

According to the New York Times:

"Digital currency, once mocked as a tool for criminals and reckless speculators, is sliding into the mainstream"

Traditional banks are helping investors put their money into cryptocurrency funds"

On Wednesday, digital or cryptocurrencies took their biggest step yet toward wider acceptance when Coinbase, a start-up that allows people to buy and sell cryptocurrencies, went public"

Got that? A late cycle tool for criminals and speculators is sliding into the mainstream facilitated by the very first  criminals who were legitimized in this cycle. 

You can't make this shit up.

Party Like It's 1929

Central banks continue to expand their idiot bubble, and it's standing room only. When it explodes this time, they will all learn the hard way there's no one left to implode...

There is no safety net beneath this fool's gambit, there is only human history's largest margin call. 

Over twenty years ago the Fed had kept its policy loose into late 1999 due to the impending millennial date change. It was believed that since most mainframe computer software had been programmed with a two digit variable year and a hard-coded '19' century, that planes would fall out of the sky when the century changed and the year wrapped around from 99 to 00. Therefore, those of us in the IT industry spent the latter half of the 1990s either recoding existing systems or in many cases upgrading to SAP, Peoplesoft, and Oracle ERP systems. In the meantime, the Web 1.0 internet Dotcom bubble was taking off, Cisco, and the other networkers were implementing massive bandwidth upgrades, semiconductor demand was skyrocketing and GDP was chugging along at a 30 year high 7% annualized amid the highest rate of employment in U.S. history (employment/population ratio) and far above anything seen since. Meanwhile the Fed was printing money to ensure systems didn't explode. 

What could go wrong?

While others partied like it's 1999, us geeks were on call that night of New Year's 1999 in case our systems crashed. But as we counted down towards midnight and watched Asia's New Year go off without a hitch, we all started to wonder in what time zone the world was going to end. 

Of course when the New Year passed and there were no planes sticking out of the ground, the stonk market EXPLODED higher into 2000 greased by an overly cautious Fed. It ramped all the way into mid March and then EXPLODED lower. 

Fast forward to 2020 and whereas the Y2K era witnessed the final melt-up in the decade-long Web 1.0 bubble in on premise InfoTech, this era is witnessing the final melt-up in the decade long Web 2.0 cloud internet migration. The COVID lockdown  massively accelerated the migration and adoption of cloud based IT systems. Entering the New Year of 2021, as vaccines arrived and COVID restrictions started to lift deja vu of the Y2K date change, no surprise the Tech sector exploded lower this past February due to the mass rotation back to economic cyclicals about a month ahead of the Y2K timeline. 

I put this chart up a couple of weeks ago showing that the 48 week rate of change in the Nasdaq then and now was identical. We also now know that the rate of change in margin debt is identical as well. 

The Dotcom bubble capped off what was at the time the longest expansion in U.S. history. This COVID bubble caps off the new longest expansion in U.S. history. This era eclipses that era in terms of duration, over-valuation, IPO issuance, fiscal and monetary stimulus overload, and of course this era has zero interest rate safety net, whereas that era had a 6% cushion on rates.

All of which puts this bubble in Ludicrous Mode: 

As I showed in my last post, IPOs this year have already eclipsed the full year Y2K and are closing in on the record full year 2020. Tomorrow happens to be the biggest IPO of the year so far. It's the crypto currency exchange "Coinbase" which is going public at an all new standard for ludicrous valuations in this era.

At its last private equity valuation, Coinbase is worth FOUR Nasdaq exchanges or 1.5 NYSE (ICE parent) exchanges. According to Fortune Magazine, in no sane world does the math compute. What is more, however, is that the entire platform is massively levered to crypto currencies which are in their own mega bubble. In other words, this stock is a mega bubble priced at an insane multiplier of ANOTHER mega bubble.

"Nothing better epitomizes the zaniness ruling financial markets these days than the great expectations surrounding the Coinbase IPO slated for April 14"

"When you do the numbers, there's no way to make an argument for owning this stock with a straight face."

Is it a coincidence that Bitcoin which is the Ponzi foundation for this all new Ponzi scheme has remained well bid into this seminal stock debut? I suggest not. Wall Street is not above bidding up assets short-term in order to keep speculative interest alive long enough to exit their underwriting deals:

The February top which was eight weeks ago in February (16th), was a mere warm-up for what is coming. Last year when Nasdaq breadth crashed (lower pane) panic ensued, whereas this year gamblers bought the dip with both hands. Unfortunately markets don't bottom on mass complacency, which is why breadth is already rolling over for a much larger crash this time around. 

 

In summary, future generations will kind of understand the Dotcom bubble as I described it above. To a lesser extent they will understand the concept behind using homes as ATM machines in 2008. This pandemic bubble however is 100% Idiocracy. 

We are trapped in an idiot bubble and the central bank plan is to keep making it bigger until it reaches the inevitable Minsky Moment. Those gamblers who need to know the exact date of "inevitable" before they stop partying like it's 1999, will soon be wishing they had a time machine instead...

No Respect For Risk

One year ago in late February, central banks were easing heavily, gamblers were partying hard, risks were growing exponentially, and then the bottom fell out with "no warning"...

What has changed in the interim? Last year gamblers were ignoring the pandemic, this year they are ignoring the pandemic's aftermath. The only other thing that has changed is that leverage has increased astronomically. In the spirit of Fooled By Randomness, central banks have created a cabal of over-leveraged morons who believe they are gambling geniuses.

Which is why the revelation that they are not, will be a "Black Swan" event. A large cataclysmic event unforeseen by those who have their heads up their own asses. 

The headlines from January and February 2020 are interchangeable with the ones we are seeing right now:

Jan. 28, 2020
2020 Is Shaping Up To Be a Strong Year For IPOs

2020 was indeed the strongest year ever, but first the market crashed and margined gamblers were wiped out. Minor detail.

In 2021, the market for IPOs is far frothier. As of the end of March, 2021 has already surpassed the entire year 2000 in total IPOs:

4/1/2021:

Compared to 2021, 2020 got off to a slow start even before the meltdown. Wall Street will keep dumping IPOs until the market explodes.

It's a tradition, why stop now?

Options speculation hit records early last year, but this year's surge makes last year's look miniscule by comparison:

Feb. 13th, 2020

"Single stock options volumes have gained 77% in the last six weeks, continuing to gain after starting the year at an all-time high"

As the month of February 2020 wore on and the pandemic grew worse, there was this warning:

Feb. 19th, 2020

Mania Has Taken Over The Market, There Is No Respect For Risk

And then "out of nowhere". Kaboom. The worst high to low crash in market history.

Fast forward one year and Bill Hwang's story is straight out of Nassim Taleb's Fooled By Randomness. An arrogant cocky trader finds early success in the markets, so he keeps doubling down and parlaying his gains into ever larger bets, until he explodes spectacularly.

He lost his entire net worth of $20 billion in two days. 

There are now untold numbers of Bill Hwang's in these markets. Newbies who now think they are investing geniuses. They've been bailed out by central banks so many times, they believe they are invincible.

However the other deja vu story that keeps getting ignored is the fact that corporate debt markets were already on the ropes last year. And ironically, the COVID pandemic saved the Ponzi market, by making it far bigger.

Jan. 22, 2020

"One of the consequences of the [central banks] easing again...is that they’re feeding the zombies, the walking-dead businesses that would be out of business by now if it wasn’t so cheap and easy to get credit"

Today 50 percent of the investment-grade market is rated BBB, and in 2007 it was 35 percent"

Got that? The end of cycle zombies were on the ropes, but they got refinanced one more time thanks to a pandemic. Now the Fed no longer has magical abilities to buy corporate bonds in the secondary market, and the LQD bond ETF just experienced record outflows. What the central banks did was kicked the debt can one more time. 

However we are to believe that the pandemic "fixed" the corporate debt problem by making it far larger. Only zombies would believe such a thing:

In summary, the glue fumes from this latest central bank asset recovery are wearing off, so they need a new excuse to intervene in markets.

In the meantime, the margin clerks will be showing today's newbies how to sell stonks. Because they apparently didn't learn that lesson last year.

When they get wiped out, central banks will come back in to buy the dip again. 

The machines are about to get Bill Hwang'd x 100 and Skynet will be offline by the end of it all.

Position accordingly. 

All Time High Fraud

Central banks are sponsoring mass stupidity and rampant fraud. The masses are now convinced it will continue forever. They are apparently unaware of the cardinal rule of pump and dump schemes - one must get out BEFORE they end, lest they become the greater fool of record...

One thing all of today's rotating pump and dump schemes have in common is that they are driven by fraudulent narratives. From Gamestop to SPACS, to Crypto Ponzi Schemes to Ark Funds, to economic cyclicals, they are all predicated upon a zero sum view of markets. One person's gain is another person's loss, and the losses are piling up silently in the background. Somehow this society's moral collapse has always remained one step ahead of the latent economic collapse, now papered over with 20% of borrowed "GDP". 

We can blame central banks all we want, but no one forced these people to believe these fraudulent narratives. For example no one forced them to believe that the post-COVID economy will be better than the pre-COVID economy, and yet based upon valuations and investor positioning, that is the assumption. 

Notice that the IMX positioning indicator is higher today than it was pre-COVID. Based on the ubiquitous view that only liquidity matters:

I read two bearish articles this weekend and now I understand why people are so one-sidedly bullish. Both articles cited various risk factors but then they concluded in a very ambivalent way that central bank liquidity can keep this party going indefinitely. In other words, today's "bears" share the consensus view that central banks are invincible:

MW: The Stock Market Has A 'Binary' Feel To It

"With all of that said, I could be wrong. This bubble-blowing bull market might rage on for three more years without looking back"

RIA: Market Surgest To Overbought As Investors Go ALL IN

"This does not mean “sell everything” and go to cash. We remain in the seasonally strong period of the year, psychology remains extremely bullish, and liquidity is still flooding markets"

"Over the next few weeks, there is little reason to be “bearish.”

If this is the bearish viewpoint, imagine the bullish views at this juncture. First off, given the murkiness of the economic outlook, today's forward P/E valuations are rife with fraud and deception. As far as technical overbought metrics, those haven't mattered since the election. And today's lopsided sentiment tells us that a lot of people will be wiped out by reversal, but it doesn't pinpoint the date.

Ironically, it's this implicit view that central banks are omnipotent that is by far the greatest risk to markets. This consensus view is encouraging people to do very stupid things with money right now under the belief they will get away with it forever.

In the corporate credit markets all manner of Ponzi borrowers are currently being funded. How bullish is it that central banks are now funding record junk bond issuance?

“It’s really hard to keep up with the issuance...Now the pendulum is shifting a little bit toward more aggressive behaviors”

In 2020, annual sales zoomed past the previous record by over $100 billion"

Emerging markets borrowed record amounts of money in 2020 and now they are facing rate hikes and currency declines, putting pressure on their ability to service their record debt load. All resulting from bullish "free money":

 

The SPAC market I've said many times is this era's stock market version of subprime, riddled with fraud. 2020 was a record year for issuance and 2021 has already surpassed 2020 on IPO issuance and doubled 2020 on impending listings.  

The housing market is now back in bubble territory.

In other words, Gamestop and Bitcoin are chump change next to what is going on in large scale financial markets.

But the biggest fraud of all is this fantasy global recovery that consists of stock market prices front-running a fictional economy.

Deja vu of last time:

"On the morning after Lehman Brothers filed for bankruptcy in 2008, most Federal Reserve officials still believed that the American economy would keep growing despite the metastasizing financial crisis"

"The transcript for that meeting contains 129 mentions of “inflation” and five of “recession.”

What the Fed didn't know in September 2008 is that the economy had already been in recession for NINE months. Why didn't they know that? Because their own crisis-driven policies were bidding up risk asset markets and commodities, creating a feedback loop of market-driven "inflation" having nothing to do with the real economy.

They fooled themselves. 

Meltdown Is A Crowded Trade

Somehow Wall Street convinced the dumb money that a 16 day bear market corrected an 11 year bull market. How did they do that?

We just learned that more money flowed into stocks in the past five months since the election than in the twelve YEARS prior:

Which perfectly fits the definition of a broadening top:

"In the broadening top formation five minor reversals are followed by a substantial decline"

It is a common saying that smart money is out of market in such formation and market is out of control. In its formation, most of the selling is completed in the early stage by big players and the participation is from general public in the later stage"

This past year was the Dow's biggest annual gain in history to an all time high. As we note from the chart above, the other two massive gains in the past two decades came at the beginning of the cycle. Which is why today's herd is convinced this is a whole new cycle. After over a decade, they finally came off the sidelines and bid up their own stonks to ludicrous valuations and now they assume there is another fool to follow. 

The last time the Dow gained a similar amount year over year was March 2009 through April 2010. Then the market exploded in early May in the infamous "Flash Crash". Of course, this time around the gain is larger and the risks are 10x in magnitude. 

Picture their reaction when what they thought was the beginning of a new bull market turns out to be a retest of last year's low. And when that fails, it turns out to be a retest of the 2009 low.

Epic shock and awe followed by epic rage.

Still, the vast majority of pundits remain sanguine. Wharton Finance professor Jeremy Siegel sees 30% upside from these levels.

He like so many others is convinced that printed money is the secret to effortless wealth:

"I think interest rates and inflation are going to rise well above what the Fed has projected. We’re going to have a strong inflationary year. I think 4% to 5%”

Got that? The Fed will lose further control over interest rates but stonks will go up regardless. High quality financial insight from a renowned Ivy League Ponzi schemer. 

What I showed on Twitter is that the weekly AAII retail bull - bear indicator is at the highest level since 2018, confirming the Ameritrade IMX positioning indicator:

Bears keep getting stampeded by dumb money, so what we see via the NAAIM survey is that deja vu of last year, active managers have decided if you can't beat 'em, join 'em. This week they took their risk exposure off of crash levels back up to last year's pre-implosion level of fat and happy:

Here we see the current state of large cap Momentum stocks. The largest holdings are: Tesla, Microsoft, Apple, Nvidia, Amazon, Paypal, Adobe, and Google. The Full Monty.

It has now retraced slightly more than .618 fibo of the wave 1 decline. Also we see in the lower pane that new Nasdaq highs have been diverging massively since the top in February. This tells us there are very few stocks holding this gong show up now. Which means that the impending decline will be very fast and catch many people by surprise.

Unlike last year, the divergence between the average Nasdaq stock and the major averages (S&P, Dow, NDX) has grown acute and unnoticed:

My advice to bulls is to enjoy the ride. Because it's a one way trip.